Mutual Funds or Fixed Deposit ? Where should you go in 2024? Investment refers to the allocation of money, time, or resources with the expectation of generating future income or profit. Investors typically seek to grow their wealth by putting funds into various asset classes, such as stocks, bonds, real estate, and commodities. The investment landscape is dynamic and influenced by economic conditions, geopolitical events, technological advancements, and market trends. Like that if you want to make investment where should you invest ? Mutual Funds or Fixed Deposit. Let’s discuss the advantages and disadvantages of both-
Table of Contents
FIXED DEPOSIT
Fixed Deposit is one of the old fashioned investment which is so reliable. Mostly parents do this type of investment, and if anyone want to invest money with almost zero risk then he/she should invest in FIXED DEPOSIT. Let’s see the details here-
Pros :
- FIXED DEPOSIT provides a stability, this is so secure that you can feel a mental guarantee for a fixed profits.
- Fixed Deposit is a good investment for protecting your money, so if you want to protect your money for emergency you should go here.
- If you are looking for a short time investment, or if you want to use this amount as per the necessity then it is good for you.
- If you want an assured increasement of your funds then here you will get a 5 to 7.5 % interest rate.
- This best for parents, and also if you want to make a stable finance gain for your parents need.
- You don’t need a great knowledge of investment.
Cons :
- Most of the fixed deposit has a fixed lock in period so this is not as good for easy exit, but you can exit with making some charges.
- You will get a fixed rate and some time the interest rate is so low.
- Long term investment is not much profitable.
- Some time its get hard to beat the inflation rate.
MUTUAL FUNDS
There is various sector in mutual funds for investing, but if go for an alternative of fixed deposit hen you should go for Debt. here you have a less risk than Stock Market And also you can earn a huge profit from it. Let’s see the details-
Pros :
- Here you will get an easy entry-exit option which not as like fixed deposit. But in some mutual funds there is an exit load charge which is not so high.
- Here you will get massive selection options. Liquid Mutual Funds, Corporate Bond, Money Market, Dynamic Bond and so on.
- Your profit is not fixed you can earn as much as you can, make good investment earn more profit.
- You can easily beat the inflation rate with your investment.
Cons :
- You will need a good knowledge for an good investment.
- In most of the time you have to wait for a long time for a good return.
- Equity Mutual funds comes under the capital gains tax, if you gain 1 lakhs within a year you have to pay 15% tax as per the tax slab and if this is after one year of buying then it is 10%.
- In some cases there is an agent who will charge some amount if you don’t buy directly.
- This not a stable investment, there is a risk involve.
Conclusion :
The debate of Mutual Funds and Fixed Deposit is important and also it has no importance in difference perspective. It solely depends on types of investor. If anyone has a great knowledge in investment and has a bravery to invest in risky market and gaining much return he can invest in Mutual Funds. And one who don’t want face any type headache with his investment, he can go in mutual funds for a safe return.
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